In the supposedly free-market capitalist haven known as Virginia, free competition is supposed to be alive and well, except if you run up against powerful and embedded special interests. Such is the case with Tesla Motors, the automobile manufacturer and dealer who has quietly (or not so quietly for car enthusiasts) revolutionized electrically motorized vehicles.
In April, Tesla Motors’ request to open a dealership in Virginia was turned down by the state Department of Motor Vehicles (DMV). According to Virginia law, auto makers are prohibited from being auto dealers in the state. However, 14 exceptions have been made to the law for manufacturers of specialty trailers, trucks, and motorcycles since 1998. A Tesla automobile could certainly be categorized as a “specialty” vehicle.
The DMV’s ruling against Tesla Motors was also made despite two recommendations that Tesla be allowed to open a dealership in Virginia under a legal exception when no dealers are available to sell its product. So much for the legal argument made for keeping Telsa Motors from selling its automobiles in Virginia.
A more insidious argument has been made by the Virginia Automobile Dealers Association (VADA), a special interest group for “franchised new car and truck dealers in the Commonwealth of Virginia,” or car and truck dealers who stand to lose business if Tesla Motors gains a foothold in the state.
According to VADA’s president, Don Hall, the association doesn’t oppose Tesla’s entry into Virginia’s family of dealerships, "I just want to make sure we don't overlook protections because of the excitement of something new." In polita-speak, VADA wants to put up clever barriers to Tesla’s entry into Virginia’s automobile market.
While VADA’s president claims that it is open to the idea of allowing Tesla Motor’s sell its automobiles in Virginia, it would seem counterintuitive since some, if not all, of VADA’s members stand to lose due to Tesla’s entry. Put another way, Mr. Hall is, in all likelihood, lying through his teeth.
Tesla Motors represents more than just a dealer and manufacturer of “high performance” electric vehicles, Tesla represents the lingering spirit of revolutionizing automobile innovation that auto manufacturers in the U.S. have long since abandoned. If Virginia fails to embrace companies like Tesla, either now or in the future, the state will undermine its image as a haven of free market capitalism. Instead, Virginia may well become a special interest manhole where the concept of innovation is just another chapter in Virginia’s history books.